14 Nov 2023
Landlord insurance for rental properties

Landlord insurance for rental properties

  • Landlord insurance may be a good idea if you own a rental property
  • Depending on the cover you choose, it could cover you for damage to your property caused by an insured event, contents and rental default cover
  • It’s a good idea to speak to a financial advisor as there could be tax implications

Owning and renting out a property comes with its fair share of risks. If you have an investment property you’re looking to rent out, you might be looking at landlord insurance. But what does it cover you for? Take a few minutes to read our guide.

Real estate agent and young couple

What does landlord insurance cover?

Most landlord insurance policies cover risks faced by landlords when renting out their property. It’s designed to cover costs for damage to the landlord’s insured buildings and/or contents caused by events like:

  • Fire
  • Flood
  • Storm
  • Theft
  • Vandalism and more

Most insurers – including QBE – give you three options: building cover, building and contents cover, or contents only cover. All QBE Landlord Insurance policies include a Rental Default by Tenant option, to protect you if the tenant fails to pay their rent.1

What factors affect landlord insurance prices?

Your premiums may be affected by the following:

  • Your level of cover – whether you choose buildings only cover, or buildings and content cover
  • The location of your property
  • Your selected Basic Excess – the higher the Basic Excess you choose, the lower your premium
  • If you choose to add the Rental Default by Tenant option to your policy, an additional premium applies

Consider your excess

Usually, the excess represents the amount you’ve agreed to contribute towards the claim, with the insurer covering the rest.

Many insurance policies have either a voluntary excess or a standard excess. A standard excess means it’s applied to every claim. You can also choose a voluntary excess, and while it may reduce the cost of your premiums, it’s a higher cost than a standard excess.

“If you choose a higher voluntary excess, it may help to bring down the cost of your insurance premiums, because it means the customer is contributing more towards the cost of the claim if they need to make one,” explains Arron Mann, QBE General Manager of Short Tail Claims.

Consider tax deductions

As a property owner you may be eligible for tax deductions. The Australian Taxation Office (ATO) website offers some helpful information.

Is it compulsory to have landlord insurance?

Most mortgage lenders will require you to have landlord insurance coverage for your rental property as a condition of your investment loan.

The Real Estate Institute of New South Wales Landlord Insurance Specialist, John Trani sums it up …

“Even though there’s no legal requirement for landlords to have landlord insurance, many property management teams now insist on having this level of cover before they take on a new property. It’s standard best practice,” he says.

1 To decide if this product is right for you, please read the QBE Landlord Insurance Product Disclosure Statement (PDS) and Target Market Determination (TMD).

This advice is general in nature and has been prepared without taking into account your objectives, financial situation or needs and may not be right for you. You must decide whether or not it is appropriate, in light of your own circumstances, to act on this advice. To decide if QBE’s products are right for you, please ensure you obtain and consider the Policy Wording or Product Disclosure Statements and Target Market Determinations, available online at QBE.com/au. Insurance issued and underwritten by QBE Insurance (Australia) Limited (ABN 78 003 191 035, AFSL 239545).

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